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Run virtual Mac OSs within base Mac OS

Several users who I support with Macs would like to be able to run Mac OS virtual machines within their base Mac operating systems. This will enable them to have one or more Mac virtual machines running within their base Mac operating systems. This will be just like setting up additional Windows virtual machines within Windows 10 or Server 2016.

Is it possible to do this?

If so what software is required and how can this be done?
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Can you provide me with a link to step-by-step instructions on how to do this with Parallels?

I already have Parallels Pro installed on this Mac.
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Is it legal to install Mac virtual operating systems using Parallels or is such a practice forbidden by the Mac OS license agreement?
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